Inflation falls to the year's new low
Inflation falls to the year's new low
JAKARTA (JP): Inflation fell to this year's low of 0.24
percent in April after reaching its peak of 1.76 in February.
Minister of Information Harmoko told reporters that last
month's low inflation was caused mainly by a 0.71-percent decline
in food prices.
He made the announcement after a limited cabinet meeting on
economy at the Bina Graha presidential office here yesterday.
"The prices of eggs and milk, for example, dropped by 7.14
percent, meat by 2.76 percent, grains by 2.47 percent and fish by
0.83 percent last month," he said.
Substantial increases in food prices due to the interruption
of transportation by floods caused inflation to reach 1.25
percent in January and 1.76 percent in February before falling
back to 0.7 percent in March.
Harmoko said housing prices increased by 0.9 percent last
month, clothing prices by 0.29 percent and the prices of other
goods and services by 0.6 percent.
"In spite of the drop in the inflation rate from last month,
President Soeharto reiterated his instructions that all
government institutions should continue their efforts to lower
the growth rate of consumer prices in the coming months," he
said.
Economists have expressed concern that the high inflation in
the first three months of this year, the government's plan to
accelerate the depreciation of the rupiah against the U.S.
dollar, and the increase of U.S. interest rates, has encouraged
money owners to save their funds in U.S. dollar deposits, thereby
causing capital flights.
Exports
Harmoko said the cabinet meeting also discussed the country's
exports and imports. Exports increased to US$2.79 billion --
including non-oil exports of $706 million -- in February from
$2.65 billion in the previous month. Imports rose to $2.15
billion from $2.05 billion.
"The country, therefore, enjoyed a trade surplus of $649.2
million in February," he said.
Last year at the same time, Indonesia enjoyed a trade surplus
of $1.08 billion, with net exports worth $2.95 billion and net
imports worth $1.88 billion.
Harmoko said the President warned that Indonesia's trade
surplus with six of its 20 major trade partners -- Japan,
Singapore, Hong Kong, China, Thailand and the United Arab
Emirates -- was decreasing steadily in the last 11 months.
Indonesia even started to suffer deficits in January in its
trade with Saudi Arabia and Italy, which caused a surplus
beforehand, the minister said.
Soeharto called on his cabinet to look for the causes of the
decline in Indonesia's exports to those countries and take the
necessary steps to increase them in the future, Harmoko said.
The minister said the Indonesian money supply -- in terms of
currency and demand deposits-- declined by almost four percent to
Rp 38.45 trillion ($17.9 billion) as of March from Rp 40.04
trillion as of February. (riz)